The Brent grade crude prices dipped to the 2004 levels indicating that oversupply continues to drive oil prices down. On Monday, Brent recorded $36.1, the lowest figure since 2004. A similar pattern is visible on the other variety- the WTI (West Texas Intermediary).
Renewed momentum in US sites is considered to be the immediate reason for the price fall. On another development, the US has revealed its intentions to enter the export market. Last week, Congress ratified a plan to remove its 40 year old ban on crude oil exports.
Observers point out that it will take considerable time for the US decision to take effect. But still crude has got a new price fall factor. According to the market analysts, US producers may enter the market when price reaches near to $50 mark.
It is expected that with the removal of the ban, around 9.2 million barrels a day besides commercial stockpiled gas will be available for exports.
US production at present is almost double that of the 2008 levels and production are peaking with expected less demand for crude in the future. Many companies are designing long term plans including production cycle readjustment at each location as carbon emission cutting norms may pull the demand down by 2025.